Indiana passes Bitcoin Rights Act, allowing retirement funds to allocate crypto assets and support self-custody wallets

On February 26, news reports indicate that the Indiana State Legislature officially approved HB 1042, the “Cryptocurrency Regulation and Investment Act.” The bill has passed both chambers and is now awaiting final signature from Governor Mike Braun. Once enacted, this legislation will open cryptocurrency investment options for public retirement plans and savings accounts, while explicitly protecting individuals’ rights to hold and use digital assets. It is seen as a significant step toward institutionalization of cryptocurrency regulation in the United States.

According to the bill, state-managed designated retirement and savings plans must offer at least one cryptocurrency investment option, managed through self-directed brokerage accounts. This includes legislator-fixed contribution plans, the Hoosier START college savings plan, and public employee and teacher retirement funds, indicating that digital assets like Bitcoin are gradually entering long-term pension portfolios.

On the personal rights front, HB 1042 explicitly limits additional barriers imposed by public institutions on digital asset use. Besides financial regulatory agencies, public entities are prohibited from banning individuals from accepting cryptocurrency payments for goods and services or restricting users from storing assets in self-custody wallets or hardware wallets. This clause strengthens legal protections for self-custody of crypto assets and on-chain ownership rights.

Additionally, the bill stipulates that the state government cannot impose additional taxes or fees on cryptocurrency transactions that differ from those applied to other financial transactions. This aims to create a fairer digital asset tax environment and reduce compliance costs. If signed into law, these provisions will take effect on July 1, 2026, further advancing the mainstream adoption of digital asset investments in the U.S.

From a broader perspective, the bill aligns with the trend of integrating digital assets into the mainstream financial system in the United States. Previously, the Trump administration permitted the inclusion of crypto assets in retirement accounts. As state legislatures continue to push forward, Bitcoin investments, pension allocations involving digital assets, and the legal use of digital assets are becoming key issues within the U.S. regulatory framework, potentially leading to long-term institutional capital inflows into the crypto market.